First-time buyers need help, not a new housing-bid system
I read with incredulity the recent proposal set out by Dr Bill Wilson, an SNP MSP for West of Scotland, calling for the reformation of the Scottish housing bid system.
Addressing Holyrood, Dr Wilson urged Scotland’s politicians to consider the end of ‘secret bids’ when submitting offers for property by replacing the current process with either a ‘fixed price’ or ‘open bids’ system. Although the proposed introduction of the single survey, following a disastrous pilot scheme that provided absolutely no mandate for change, is not long off, it amazes me that the Scottish Government seems intent on further revolutionising the Scottish system of house buying and selling; a system that, the world over, is admired and applauded.
Dr Wilson tells us that he was approached by a young couple in his constituency who have experienced difficulty purchasing their first home, despite both being university graduates with full-time jobs. It is not unusual for first-time buyers to stumble once or twice before succeeding in securing a property and the primary role of their solicitor is to use his or her expertise in the property market and advise accordingly. I assume that Dr Wilson has satisfied himself that the advice being given to this particular couple was sound otherwise he is in danger of drawing his conclusion from a false premise. The idea that one case brought before an MSP should prompt a call for a complete overhaul of a system that has been in place for as long as people have been buying and selling homes in Scotland beggars belief.
Whilst I willingly concede that first-time buyers often struggle under the current ‘offers over’ system, once they have that first foot on the property ladder, they, as home owners, would then be disappointed to find a sale process ultimately designed to work against them, and in favour solely of the buyer.
Dr Wilson’s proposal to implement a house-selling model reflecting the English system would do very little to relieve the current problems faced by first-time buyers in Scotland. Rather, the threat of gazumping would become a reality north of the border, an inevitable by-product of the open bid system, and one that is generally accepted as the single most destructive device in the English market.
Rather than meddling with a system that works could I respectfully suggest that Dr Wilson lobbies the Government to provide more help for first time buyers. Notwithstanding the current annual inflation in the Scottish housing market successive Budgets have failed to raise the Stamp Duty threshold at the lower end of the market thus ensuring that an increasing number of first time buyers are saddled with significant costs when they can least afford them. If the decision was taken to raise the stamp duty threshold to say £200,000, the £2,000 saved would provide real and practical assistance to first-time buyers. Dr Wilson would do well to listen to his own First Minister who I believe is proposing a £2,000 first time home-buyers’ grant to assist them getting onto that first rung of the property ladder.
Wilson Hunter is a partner at Hunters Residential, part of Gillespie Macandrew